October 2020retailtechinsights.com 19THE PHYGITAL FRONTIERBy Lockie Andrews, CIO/CDO, UNTUCKitThe retail industry has been slow to unite physical and digital ("phygital") channels. COVID-19 accelerated digital and eCommerce adoption by at least ten years, causing supply chain, delivery, and operational issues at most retailers. In contrast, companies with agile and omnichannel infrastructure were well positioned. This article examines the key technologies driving retail success during the pandemic. COVID CrisisAs I write this article, the United States is 140+ days into the first wave of the COVID-19 pandemic. The majority of brick and mortar stores have reopened with safety restrictions in place. Retail executives operate in a new paradigm as virus hot spots re-emerge in the southeast, forcing a possible second wave of store closures.While the essential workers and medical teams were the undisputed heroes of the pandemic (7 pm applause please!), special recognition is also warranted for the operations and technology teams who kept companies running. We are grateful for the sales associates who risked their lives to ensure consumers could buy everyday essentials, and the tech professionals who pivoted on a dime to set up remote work capabilities. Underpinning life in this `new normal' is the consistent and enabling presence of technology.The stellar financial results reported by some brands were aided by frictionless shopping journeys that leveraged the best of phygital retailing.In Figure 1: COVID-19 and Omnichannel Competitor Matrix, we analyzed a competitive set of select large retailers. Evaluating each company's penetration of COVID-friendly product categories versus their digital maturity helped explain the duality in financial results. Based on their recent earnings reports, the COVID winners shared a similar playbook for responding to the crisis: 1) analyze data, predict trends, and in real-time shift their 2) inventory and supply chains 3) distribution strategies 4) human capital and 5) marketing dollars. The simplicity of the above statement completely masks the complexity involved in executing each of its tenets.Underlying the seemingly auto-magical experience of buying a product online and having it delivered to your doorstep is highly integrated and expensive technology infrastructure. Calling upon no less than five enterprise-level systems, omnichannel is the holy grail of phygital, and is the most elusive.The core enabling technologies required to execute the five phases successfully are as follows: 1) business analytics and real-time insights software, 2) enterprise resource management systems, 3) omnichannel order management platforms, 4) workforce management tools and 5) CRM solutions with a 360-degree view of customers and products with online and offline integrations.I have classified seven popular omnichannel use cases in Figure 2: Omnichannel Maturity Index to illustrate a brand's linear journey to omnichannel from a customer's perspective. While there is no "one way" to deploy these feature sets, Figure 3: Omnichannel Technology Infrastructure provides a Lockie AndrewsSource: Catalyst ConsultingcIo InsIghts
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